Poverty in India: The Measurement Debate

Why Poverty Numbers Keep Changing

The official poverty line in India has been revised multiple times - Dandekar-Rath (1971), Alagh Committee (1979), Lakdawala Committee (1993), Tendulkar Committee (2009), Rangarajan Committee (2014). Each produced different numbers, different poverty ratios. UPSC expects you to understand why - not just know the committees.

The core methodological disagreement:

Calorie-based approach (older): Define poverty as inability to afford a minimum calorie intake (2,400 kcal/day rural, 2,100 kcal/day urban). Calculate the spending required to meet this, and set that as the poverty line.

Problem: People spend money on things other than food - transport, education, health. A pure calorie benchmark ignores non-food poverty.

Tendulkar approach: Shifted to a consumption expenditure basket that includes food and non-food items (health, education, clothing). Poverty line set at ₹816/month rural and ₹1,000/month urban (2011-12 prices). This was higher than the previous line and thus showed a higher poverty count.

Rangarajan approach: Further revised upward - ₹972/month rural and ₹1,407/month urban. Showed an even higher poverty count (29.5% vs Tendulkar's 21.9% for 2011-12).

The lesson: India does not have a single agreed poverty line. The choice of methodology is partly political.

Multidimensional Poverty Index (MPI)

UNDP's MPI measures poverty across three dimensions and ten indicators:

• Health: Child mortality, nutrition
• Education: Years of schooling, school attendance
• Living standards: Cooking fuel, sanitation, drinking water, electricity, housing, assets

A person is considered multidimensionally poor if deprived in at least one-third of the weighted indicators.

India's progress: India lifted 415 million people out of MPI poverty between 2005-06 and 2019-21 - the largest absolute reduction ever recorded in the index's history. The MPI poverty ratio fell from 55.1% to 16.4%.

This is a significant Mains point: income-based poverty reduction and multidimensional poverty reduction do not always move together. India has done particularly well on the living standards indicators (electricity, sanitation from Swachh Bharat, LPG from Ujjwala) while nutrition remains a challenge.

The Inequality Dimension

Poverty reduction is not the same as equality. India's Gini coefficient (measure of inequality, 0 = perfect equality, 1 = perfect inequality) has increased even as poverty has fallen. This means the rich have gained disproportionately more.

The Oxfam India Inequality Report regularly documents: